Wayne Wile on the Markets

Looking a Little Toppy?

The major stock indices were decidedly weaker today and the usual attempts to “buy the dip” for once fell flat. About an hour into the day the S&P had lost about 0.75%, the Dow was down 0.5% while the Nasdaq led the charge lower with a loss of 1.25%. But unlike so many other days, the indices fell further and closed on their lows with the S&P losing 1.45%, Dow down 0.91% and the Nasdaq down 2.13%.

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Garbage Stats and Real Stats: Lessons in who to believe on the economy

In January, 2015 heavy snowfall and cold weather across the country had everyone expecting a disastrous estimate of Q1 GDP. I’m sure you remember the vicious “polar vortex” that was endlessly reported at the time. And as predicted, in its April 29, 2015 first estimate of Q1 GDP, the Bureau of Economic Analysis (BEA) said the US economy grew by only 0.2%. The number was so bad the BEA decided to increase its seasonal adjustment provisions because they were obviously not adequately reflecting the impact of winter weather during the winter season.

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The Most Complacent Markets in History

The VIX, the yardstick for measuring volatility in US stocks, is once again trading below 10.  Here are some statistics from Kyle Beard of Bloomsbury Advisory: “The VIX has only traded below 10 41 times since 1993 (intra-day). 21 of those occurrences have taken place since May 1, 2017. When you consider there have been 6,179 trading days since 1993, you realize how incredible this is.”

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